So Michael Noonan, our finance minister, apparently is unconcerned about Greek exit from the Euro, joking last week at an investment conference that we didn’t actually import anything from Greece much, apart from Feta Cheese. So that’s ok so…. I suppose the analogy of the Greek economy with a crumbly animal byproduct that is an acquired taste and not really very popular was too tempting to avoid.
It was still rather a bizarre statement. If Greece were (when it does?) leave the Euro, the effect will be to make Greek exports cheaper and imports to Greece more expensive. Ceteris paribus we would expect to see the trade balance between Ireland and Greece shift in Greece’s favour. We would export less to them and import more from them. While that is all very helpful to Greece it is less so to Ireland and makes the blithe insouciance of the finance minister puzzling. I suppose its about confidence….
The other puzzling element is that its not even true. We export several hundred million dollars worth of goods to Greece each year, which in a grexit will be much less competitive. And we import a small amount, its true, but Feta isnt even the largest amount.
The import/export profile of Irish trade with Greece is as below (in $). FWIW there is a nice tool here from the OECD that allows one to look at bilateral trade
|Food and Live animals||Imports||7,513,252|
|Beverages and Tobacco||Imports||5,455|
|Crude Materials, Inedible, Excluding Fuel||Imports||384,758|
|Mineral fuels and related||Imports|
|animal and vegetable oils fats and waxes||Imports||144,984|
|Chemicals and Related||Imports||16,950,172|
|machinery and transport equipment||Imports||2,434,467|
|Miscelleaneous Manufactured articles||Imports||6,030,702|
|Commodities and transactions not eslewhere specified||Imports||729,877|